Exam 6: Elasticity

Decreases in input costs and a longer time since a price change will tend to:

Use the following to answer question: -(Figure: Demand for Notebook Computers)Use Figure: The Demand for Notebook Computers.Total revenue at point V equals the:

If the price of tacos increases from $1 to $2 and customers decrease their consumption from 10 tacos to 8 tacos,what is the price elasticity of demand (by the midpoint method)?

If the price elasticity of demand is found to be 6,then demand is:

Use the following to answer question: -(Figure: The Demand Curve)Use Figure: The Demand Curve.By the midpoint method,the price elasticity of demand between $6 and $8 is approximately:

The price elasticity of demand for lettuce has been estimated to be 2.58.If an insect infestation destroys 10% of the nation's lettuce crop,how will that affect total revenue from lettuce,all other things unchanged?

If an increase in the price of cotton increases total revenue,then the price effect is _____ the quantity effect.

Suppose that an increase in the price of a good leads to an increase in total revenue.Ignoring other factors (like supply),at its current price the good must be:

The price elasticity of demand along a demand curve with a constant slope:

Goods are _____ when the cross-price elasticity of demand is positive and _____ when the cross-price elasticity of demand is negative.

Suppose the price of gasoline increases 10% and quantity of gasoline demanded in Orlando drops 5% per day.Demand for gasoline in Orlando is:

Eric's income increased from $40,000 to $50,000 per year.Eric's consumption of tickets to pro football games increased from two to four per year.By the midpoint formula,his income elasticity of demand for pro football game tickets is equal to _____,and football game tickets are _____ goods.

If the income elasticity for hybrid cars is positive:

You are the manager of a supermarket,and you know that the cross-price elasticity of peanut butter to jelly is exactly -2.0.Because of a bad grape harvest,grape jelly prices are expected to rise by 10% next year.To account for the change in demand,you should stock 10% more peanut butter.

If your purchases of good A increase from 9 units per year to 11 units per year when the price of good B increases from $8 to $12,all other things equal,for you,good A and good B are considered _____ goods.

Assume the price elasticity of demand for corn has been estimated to be 2.33.Flash floods destroy 10% of the nation's crop of corn.Which statement BEST describes how this will affect total expenditures on corn,all other things equal?

Use the following to answer question: -(Figure: The Demand Curve)Use Figure: The Demand Curve.If the price is $3,total revenue is _____.If the price is $4,total revenue is _____.

The university president believes that increasing student tuition by 5% will increase revenues.If the president is correct that revenues will increase,then the tuition increase will _____ the number of students enrolling by _____%.

If an increase in the price of a good leads to an increase in total revenue,the _____ curve is price _____.

Consider the market for strawberries.Which statement MOST likely applies to the strawberry market?